Trading journal

[dushimes]

Just because something looks like a set-up, I don’t have to look at it like ¨what’s the best way to trade this?¨

That means I have no idea.

However, if I see a sign that’s very obvious and fits my strategy, I can choose a position in confidence, and set a straddle as a backup.

And when the FOMO kicks in, I just remember that there are always more trades.

This is something for me to think about more because when I have some good trades trending, my losses are setting me back further and further. What a waste.

[greenscorpio]

Fomo !!! the past no longer exist s dushdimes, it’s no longer reality it’s difficult to accept especially for people abit on the Obsessive side.The mindset of successful trading is almost been blase to outcomes without been irrational like a novice ,I suppose pokers players are similar not that I’m interested in poker

[dushimes]

The irony is that with all the good and bad trades that I’ve had. If I waited and waited, and skipped all but one good trade, I’d be waaay ahead of myself right now.

Just something for me to think about. If I just waited for a few very specific trades…trades so obvious that when you see it, there’s not much thinking to it…

If I waited for just a few of those each week, I’d be much further ahead. If I traded 3 times per week, signals that are clear as day, my balance would be much bigger.

Hmmmmmm

[dushimes]

Self-sabotage.

I had placed an order, it got triggered yesterday, but I had my doubts and closed it when it hit BE.

I just checked it, and price is going in my favor. Aaaaaaaargh!!!

I told myself I would stop closing trades manually, and here I am again.

[dushimes]

I learned that it’s difficult to see some signals when they contradict what you’re expecting.

I missed out on some very nice big swings because of my expectations. It’s easy to say what you should have done after the fact. But when you see certain set-ups, you think one thing and you are waiting for that move to happen, and then an unexpected signal appears. You really don’t know what will happen next.

Some market moves appear random until after the trade.

[SovoS]

A theme that seems to be running through your posts is the lack of confidence in your own strategy. You seem to be constantly in a battle between what your strategy is saying and what you personally think. You appear to follow your strategy up to the point when you actually enter your trade…and then shift your focus to just watching, following - and re-interpreting - what price is doing as it oscillates back and forth. This suggests a total lack of confidence that your strategy is going to perform.

You need to let go of your own contra-opinions and trust your strategy. But don’t take my word for it, here is what @Johnscott31, a profitable trader, has to say:

@Johnscott31

I’d say my one redeeming trading skill is my ability to have no idea what is going to happen next (yes you read that correctly). I have truly accepted the random nature of markets - first brought to light with the book Trading in the Zone , but took me a lot longer to actually do it.

I am able to separate my opinion from the facts - the facts being price and price only.

You wrote earlier:

@dushimes

I mean arrogance that the strategy will work. If I see a signal, just take it. Have faith/arrogance/confidence that the strategy will do the work.

That is not arrogance, it is commonsense! Look at it this way:

Your strategy is based entirely, 100%, on price information on your chart(s). And what is price based on? Nothing less than the majority action of all the other participants in the entire market

So your strategy is telling you what the majority of market participants are doing. Therefore, when you doubt your strategy, you are placing your own opinion against that of the majority. Do you really believe that you know better?

So if you believe your strategy works, then you must believe that it knows more than you do about what the market is doing - regardless of your own opinion.

Your strategy is telling you something. Although no one knows where the market is going next, is it certainly going where the majority pressure is pushing it. So your strategy can tell your four important things:

• in which dominant direction price is moving
• what is significant price movement and what is just the current “noise” (or the market breathing)
• when a move has probably run out of steam
• at what price the current scenario is nullified

You take a bus because you believe it is going to where you want to go. But if, every time it stops at a red traffic light, you jump off, cross the road, and take a bus in the opposite direction, you will never get there…

Just some thoughts along the way :D…

[Johnscott31]

@SovoS

Much of what you write here reminds me of me for so long - I was the ultimate strategy tweaker - and I can confirm that it’s definetly a road to ruin if you don’t snap out of it.

And… occasionally even now I fall back into the habit.

[SovoS]

@Johnscott31

I was the ultimate strategy tweaker…And… occasionally even now I fall back into the habit.

Haha! I think I would be a close runner-up in that department!!!

But it is maybe not always a bad thing, I guess it depends a lot on the reasons why! For example, if one just jumps from one strategy to another every time there is a loss then it will end up really badly.

But I think personality and character are also behind this phenomena. For example, some people hate change and others actively seek it and enjoy it.

My biggest “problem” is an insatiable passion to seek and try out anything new! This means every time I read someone describing a certain approach I have to set it up on my own charts and have a look at it - maybe even try it purely from curiosity!

I constantly play with colour changes and parameter values but I don’t deviate from my core strategy. It is just a characteristic…and every weekend I clear out all the new templates that I have saved during the week!

But this is ok when it is controlled and understood. It is just part of the trading fascination, dedication and variety. It also keeps the brain cells fed and alive!

I wonder what @dushimes is going to make of all this…

[dushimes]

@SovoS

So your strategy is telling you what the majority of market participants are doing. Therefore, when you doubt your strategy, you are placing your own opinion against that of the majority. Do you really believe that you know better?

So if you believe your strategy works, then you must believe that it knows more than you do about what the market is doing - regardless of your own opinion.

Very good point. Thanks for responding and pointing out all this. And it’s true. The purpose of the strategy is to reduce most of the thinking. The thinking is in the strategy.

For example, I saw a reversal sign. I thought, ¨not yet, it’s probably gonna push bullish a little more.¨ My strategy says to take each signal, and I could be wrong 3 times, but it’s worth it. That’s in the strategy: take each signal.

Well, I didn’t take it. I missed out on a PERFECT entry, and it turned into a nice big bear swing. I wouldn’t have even been wrong ONCE! But I didn’t follow the strategy because I was scared of the loss.

So, based on your analogy, I didn’t even get on the bus…and the hot date that was waiting for me downtown had left.

By the way, I check a recent consolidation in CAD/CHF. I compared how I actually traded it with how I SHOULD have traded it. Basically, I took four extra unnecessary losses. Three of them were in the WRONG direction!

So, my eyes are a bit more open now. I just have to wait, and when I see the sign, I have to act on it. Wait, wait, wait, go!

[dushimes]

@SovoS

and every weekend I clear out all the new templates that I have saved during the week!

Delete all those templates? Aaaaaargh!! haha So, it’s all for curiosity? That’s pretty cool. But you said you keep your core strategy…Would you ever trade your core strategy for another?

And if your strategy works, why bother looking for another? Just to explore the possibility of more profits?

I imagine that if a strategy works, don’t bother looking for another. Instead of staring at the screen even longer, go outside and play! Or no?

[dushimes]

@SovoS

I wonder what @dushimes is going to make of all this…

Well, first, thanks for reading and responding. I really appreciate it.

Second, I think my improvement lies within doing less–not more. It’s a matter of doing too much, thinking too much, and trading too much.

For now, I don’t think I need to follow more pairs. That’s one good thing. I’m ok where I am. Any additional pairs would just be a distraction.

One problem I have is that I fail to stick to my strategy, take losses, get confused and scared, then miss out on the right trade.

I also get scared that I’ll miss out on big swings in the opposite direction. If I’m going short in a consolidation zone, I worry that I’ll miss out on a sudden giant bull candle. That fear really messes with me.

But traders have said here that you just have to trust your strategy and the profits will take care of itself.

I’m carrying on too much here.

I have to keep focused on following the strategy and jumping in when it’s time to jump in.

[SovoS]

@dushimes

One problem I have is that I fail to stick to my strategy, take losses, get confused and scared, then miss out on the right trade.

I also get scared that I’ll miss out on big swings in the opposite direction. If I’m going short in a consolidation zone, I worry that I’ll miss out on a sudden giant bull candle. That fear really messes with me.

But traders have said here that you just have to trust your strategy and the profits will take care of itself.

When I read this, I have to say that I fully understand the emotions you are describing and that they are probably common to 99% of all traders.

However, I think the answer to this is not in your strategy at all…

The issues you are describing are entirely in the field of risk/money management. For example, you say:

@dushimes

If I’m going short in a consolidation zone, I worry that I’ll miss out on a sudden giant bull candle. That fear really messes with me.

Firstly, you can wait for the confirmatory break-out from that consolidation zone before entering and, secondly, you place your stop on the other side of the zone to close out if the breakout is a fake. You know from your strategy that whenever the breakout is real then you will make more from the trade than you would lose if it is a fake. It is just simple money management. You risk management determines the position size/stop distance relative to your equity.

I know from your posts that you already focus a lot on your risk considerations and that is very good. But I think you may be failing to link this with your actual trade decisions.

Would I be right in thinking that whilst waiting for a set-up you focus on your strategy and risk/money issues - but as soon as you are actually in a trade that all goes out the window and you just watch the price moving and wonder if…

@dushimes

So, based on your analogy, I didn’t even get on the bus…and the hot date that was waiting for me downtown had left.

Like it!

[SovoS]

@dushimes

Delete all those templates? Aaaaaargh!! haha So, it’s all for curiosity? That’s pretty cool. But you said you keep your core strategy…Would you ever trade your core strategy for another?

No, I would never change it. There is no need. My strategy is indicative rather than definitive. It offers me situations that might be profitable and I like to add a lot of personal discretionary input to the decision process. That is simply because that is where I find the pleasure in trading and brings me closer to understanding and recognising the nuances of my market.

On the other hand, I very rarely enter a trade without the “blessing” of a set-up from my charts!

@dushimes

I imagine that if a strategy works, don’t bother looking for another. Instead of staring at the screen even longer, go outside and play! Or no?

This depends on one’s motives. If one is only interested in making money then I agree there would be little reason or motivation to look beyond one’s own method - in fact, it could even be detrimental to do so!

But if one is generally interested in trading then one is automatically interested in what others are doing and what works for them. If one is generally interested in art and likes traditional landscapes it doesn’t mean that one doesn’t also look at Salvadore Dali or Magritte…

There are many ways to set up a chart and decide what to put on it. Just as there are many fashions that determine what people wear. What suits one does not suit another - but it is all of interest.

I am a day-trader but I do not spend much time on charts. I do my analysis in the morning, decide what I am looking for and set things up…and then leave it. I usually do one trade in the European session and sometimes another during the US session, and that is it. In both sessions I am usually in and out within 1-2 hours and I’ve been paid (or sometimes not ) and then I am free - and stress free - all the rest of the day

I read some forums and other media whenever I am in the mood to see what other traders are up to. I have a passion for trading per se and for the markets in general. Whenever I read about someone’s approach that catches my interest I look into it - just like stopping and staring at someone else’s car in a car park that catches your eye - it doesn’t mean you would want to buy it for yourself.

My wife is not interested in cars. For her, a car is something that gets from A to B safely, economically, and reliably and doesn’t burden the environment, and that is it, no need to look further. I, on the other hand, love cars and driving. Whenever I take my car for service I ask for a courtesy car that interests me, like a new EV, for example. But it doesn’t mean I will buy one. I also follow F1 and rallies. But that doesn’t mean I want to drive like that around my own town

Trading is such a vast subject. It covers all kinds of products, each with their own backgrounds and interactions on both micro and macro levels. It makes you look inside yourself and find things you didn’t know were there. It works on all kinds of principles found in other businesses everywhere and yet has its own very unique features. And it is a personal challenge where there is no fudging of the results. You either win or you lose - but, either way, the journey is so fulfilling!

But it is time to get on with some of those “other things”!

[dushimes]

@SovoS

I read some forums and other media whenever I am in the mood to see what other traders are up to. I have a passion for trading per se and for the markets in general. Whenever I read about someone’s approach that catches my interest I look into it

Gotcha. So, it’s more for personal interest; not about searching for a more profitable strategy. I understand.

There are so many different strategies, dynamics, and perspectives when it comes to trading. You’ll never be bored!! haha

[dushimes]

I had several losses today. One of them was a trade I wasn’t sure about taking. There were two other pairs with the same mixed signals, so instead of trading all three I only traded one, just to see what would happen.

It didn’t go well. I suspected it was better to stay out, and I was right. At least I didn’t take the other trades as well.

One trade, GBP/AUD, I moved my SL down to lock in some profits, and price turned against me. It’s ok. I got some profit. I’ll examine the trade later to see what I could have done differently.

There were two trades that really bothered me. One of them I should have entered but didn’t follow my strategy. The other, I had the right entry, but I closed too early when it was consolidating. I saw price action indicating that it could be a reversal sign. But it was a fakeout and I closed instead of holding.

This means I have to add some plan about how and when to close. I actually did already, but maybe I need to add some more details.

I picked up some good experience this week. There are three trades I want to examine this weekend.

This process is awful. I’m gonna vent for a little bit. This learning process is tough. I feel like an onion, and I’m constantly peeling off layers. I hope I have something sweet in the middle, like a cherry or a chocolate chip.

[dushimes]

One good thing I forgot to mention regarding the trade I had a good entry but closed too early:

I was right! My entry was spot on! I have to be grateful for that. Knowing when to jump in is half the battle!

I got this!! Let’s go! Let’s go! Let’s go!!!

[greenscorpio]

@Johnscott31

I’d say my one redeeming trading skill is my ability to have no idea what is going to happen next (yes you read that correctly). I have truly accepted the random nature of markets - first brought to light with the book Trading in the Zone , but took me a lot longer to actually do it.

I am able to separate my opinion from the facts - the facts being price and price only.

I remember a post a while back ,a member said the markets are completely random and you quoted that I disagree the markets are predictable after year s of experience I know this now ,I realise there are lots of different "meaning s "to this response but it be interesting to hear what you meant John

[Johnscott31]

There are certain points in the market where the odds favor a change in direction. However, they are just odds.

Sure markets are not random completely but by accepting that each trade you make has no one specific
outcome (namely a win) you don’t get nearly so attached to an outcome. And as a result, you can trade with a clear(er) head.

The incessant internal dialogue that comes with needing a certain trade outcome is a large part of why we fail as traders.

Now, just because you set a stop loss does NOT mean you have accepted that anything can happen. This is all explained well in the Mark Douglas book Trading in the Zone.

In short its nonattachment to a specific outcome. And that mindset is hard to achieve particularly when we are already on a bad trading run.

It’s the same reason why the Samurai adopted Zen, the last thing you need as a foe is wielding his sword at you is an internal dialogue saying you may be about to get killed.

Such nonattachment can also be found in top sportsmen and women. If you are worried about what the crowd is thinking, you going to choke.

I am surprised that you say I use the word ‘prediction’ in a previous post. I am very much against that specific word - so apologies if I ever used it.

In the book Better Share Trading by Darryl Guppy he talks about the two camps of trading styles, the prediction camp and the probability camp. The prediction camp has a woefully poor record when it comes to trading - I read that book a long time ago and the concept was burned deep into my brain - so I do find it surprising I used the word at all.

[greenscorpio]

Thanks for the explanation, understood yes Im in that mindset now after a few years, the markets are predictable.but yet random , The markets are very much alive and can be choatic or “stubborn/indifferent” at times . I never read in the zone book, but in the early years listened to it several times and watched his presentations,
The quote what always always stays with me anything possible. Outside of trading exceptional bad luck dose happen in life , the world’s events ,who would have predicted what has happened over the last five years .The unpredictability of sport at times is what makes it interesting .

[dushimes]

@Johnscott31

There are certain points in the market where the odds favor a change in direction. However, they are just odds.

Funny you said that. I’m taking time today to study consolidations, and I took a note on a particular set-up within the consolidation.

It’s a candle that I would normally say, ¨yeah, trade that.¨ But I’m trying to avoid certain trades.

There are trades that fit my strategy very well and some that I’m actually forcing. The ones I’m forcing are trades that COULD be a good trade, but there are conflicting signals. Those are the trades that have a lower probability of success.

And I’ve taken them out of desperation. I’ve written in an older post that there are no certainties; just probabilities. The trades that fit one’s strategy are of higher probability.

I’ve taken too many trades that have low probability of success. Those are the ones I’m trying to avoid now.

Frankly, I think it all comes down to patience and precision.